president obama on the fiscal crisis threatening our nation. welcome. i and shannon bream and four megyn kelly. shannon: if he and lawmakers cannot reach a deal for the end of the year, not only will there be major spending and budget cuts, but americans will see some $536 billion in additional taxes. effecting ae% of u.s. households. to the tune of $3500 on average per household. we have fox team coverage as we await the president's remark. analysis from bret baier. but first, ed henry is standing by live. what can we expect? >> good afternoon, shannon. the president will announce at

the beginning of his remarks that he is inviting congressional leaders to the white house next week. as congress comes back in session. that is to try to jumpstart the conversations about the fiscal cliff. economists are predicting that we could have a double dip recession if the economy gets the double whammy of massive spending cuts kicking in on january 2. and a big tax increases kicking in. the president celebrating in chicago. the sobering reality of governing is setting in here. the president is going to have a crowd of people, we are told, middle-class families who will be impacted by the fiscal cliff. the kind of thing you might see on the campaign trail, raising the question is whether or not the campaign continues. as the president tries to go directly to the american people and sell his case.

john boehner said this is his moment. his opportunity to leave. shannon: i would like to play a little bit more about what john boehner has said. and then i would like to play more about what brett said about this. but first, what john boehner said to diane sawyer. >> raising taxes is the wrong prescription. >> raising tax rates is unacceptable. frankly, it could not even pass the house. shannon: bret baier is the anchor of special reporting. what is your reaction? we understand that the president will invite congressional leaders over. >> we will also probably here from his senior adviser, david

plouffe. the one thing that is interesting, if you look at the polls on the question of income tax rates, you have 47% that want to increase for those about 250,000. no increase for anyone tax increases, and 13%, increases for all. 47% 1,250,000 or above and 48% don't raise them at all or reason for everyone. so, you know, if you look at the exit polls, there is not really a definitive answer there. the republicans are going to say this is not the right answer and that is how they are starting to negotiation. the democrats have a stronger hand here.

and you could have, at the table, some back-and-forth on exactly what the number will be. what the capital be when tax rates go up. shannon: yet i would like to bring you back if you're still there. you mentioned that much of this is going to look like a campaign event. we have people who are going to be middle-class americans and stakeholders who don't want to see taxes raised. what about the other side of the conversation. what about those with spending cuts? where are they represented? >> we will have to see if he uses the transport. let's not forget the republicans on capitol hill presented their approach of not raising taxes. the m-word, as in mandate. they are saying they have a mandate that pushes back on the

president and they will do the checks and balances over the next four years to a president that will not face the voters again. it is going to be key as they get together finally next week to try to hash this out. how are they going to deal with this fiscal cliff so that we don't have a double dip recession? shannon: i would like to turn back to bret now. we have heard many say this is a moment for the president to step up. today, he reiterated that again. saying it is your turn to get something done. it doesn't seem like out of the way the president has worked in the past. it has not been very kumbaya or touchy-feely. there's been a lot of friction. >> this indication that he will invite both sets of leaders to start talking is one indication that things may have started to

change. we will likely hear a different tone from the president now. there is a deadline. this fiscal cliff is real. it is something that is over the heads of lawmakers and is something that would affect the economy dramatically according to the cbo and as edmonton, would really send the economy into a double dip recession. both sides of the aisle say there is no doubt about that. now, republicans would like to do some kind of deal that takes us into the next year so that you could do a bigger deal. a simpson-bowles deal. entitlement reform on the roster. but that takes time. you can't do it in a lame-duck session, and frankly, the new congress would be the one you'd want to deal with. that is what speaker boehner would talk about the day before. democrats would like to push forward on the bigger deal. sooner as you see people filing

in. it is an interesting give-and-take here. the tactics, as the president gets ready to make his remark. shannon: he said all revenue has to be on the table. everything has to be on the table. how much pressure is going to be on him from factions within the gop to say everything is on the table, he said no new taxes. they are not going to be very nuanced. to he is saying closing loopholes and expanding the base. he is saying tax reform but not raising rates. this is what governor romney talked about on the trail and got hammered because they were not specifics on the campaign trail. now, there will be a battle between raising tax rates. that is what democrats want to see on the upper tier. shannon: now to the president at the white house.

[cheers] [applause] [cheers] [applause] thank you. thank you everybody. [cheers] [applause] thank you. thank you so much. thank you. thank you very much. please have a seat. good afternoon, everybody. now that those of us on the campaign trail have had a chance to work together, there is plenty of work to do. as i said on tuesday night, the american people voted for action. not politics as usual. we would like to focus on your jobs and not ours. in that spirit i have invited

leaders of both parties so we can start to build consensus around the challenges that we can only solve together. and i also intend to bring in business and labor and civic leaders from all across the country here to washington to get their ideas and input as well. at a time when our economy is still recovering from the great recession, our top 30 has to be jobs and growth. that is the focus of the plan that i talked about during the campaign. [applause] it is a plan that rewards small businesses and creates jobs here and not overseas. a plan to get the education and training for people that businesses are looking for today. being a global leader in research and jobs to america.

a plan to put folks back to work. including our veterans are in rebuilding our roads and bridges and other infrastructure. it is the plan to reduce our deficit in a balanced and responsible way. our work is made that much more urgent because at the end of this year, we faced a series of deadlines to make major decisions about how to pay our deficit down. decisions that will have a huge impact on the economy and the middle-class both now and in the future. last year, our work with democrats and republicans to cut a chilly in dollars worth of spending that we could not afford. i intend to work with both parties to do more, and that includes making reforms that will bring down the cost of health care so that we can strengthen programs like medicaid and medicare from the long haul. as i have said before, you cannot just cut our way to prosperity. if we are serious about reducing

the deficit, we have to combine spending revenue. that means asking the wealthiest americans to pay a little bit more in taxes. that is how we did it. [applause] is how we do that in the 1990s. this is the only way we can help our children pay for college. making sure that our jobs like high-tech manufacturing don't end up in china. already, i have put forward a detailed plan that allows us to make investments while reducing our deficit by $4 trillion over the next decade. i am not wedded to every detail

of my plan. i am open to compromise. i am open to new ideas. i am committed to solving all our fiscal challenge. but i refuse to accept any approach that isn't balanced. i am not going to ask students and seniors and middle-class families to pay down the entire deficit while people like me, making over $250,000 on asked to pay a dime more in taxes. [applause] i am not going to do that. [applause] and i just want to point out this was a central question in the election. it was debated over and over again. on tuesday night, we found out that the majority of americans agree with my approach. that includes democrats, independents, and a lot of republicans across the country, as well as independent economist and budget experts.

that is how you reduce the deficit with a balanced approach. so our job now is to get a majority in congress to reflect the will of the american people. i believe we can get that majority. speaker boehner agreed that tax revenue has to be part of this equation. i look forward to hearing his ideas when i see him next week. i would like to make one final point that every american needs to hear. right now, congress has failed to come to an agreement on an overall deficit reduction package at the end of the year. everyone's taxes will go up on january 1. everybody's come including a 98% of americans who make less than $250,000 a year. that makes no sense. it would be bad for the economy and would hit families that are already struggling to make ends meet. fortunately, we should not need long negotiations were

dramatists all that part of the problem. there may be disagreement in congress over whether or not to raise taxes on folks making over $250,000 per year. nobody. not republicans or democrats want taxes to go up on those making under $250,000 per year. let's not wait. even as we are negotiating a broader deficit reduction package, let's extend the middle-class tax cuts right now. let's do that right now. [cheers] [applause] that one step would give millions of families, 98% of americans and 97% of small businesses, the certainty that they need going into the new year. it would immediately take a huge chunk of the economic

uncertainty off of the table. that will lead to new jobs and faster growth. business will know that consumers, they will not see a big tax increase. they will know that most small businesses won't see a tax increase. a lot of the uncertainty that you're reading about, that will be removed. in fact, the senate has already passed a bill doing exactly this. all we need is action from the house. i have the pen ready to sign the bill right away. i'm ready to do it. i am ready to do a. [applause] the american people understand that we will have differences and disagreements in the months to come. on tuesday they said loud and clear that they will not tolerate this function and they will not see compromise as a dirty word. not when so many americans are out of work. when so many are still

struggling to pay the bills. they are looking for cooperation and consensus and common sense and most of all, they want action. i intend to deliver for them in my second term. i intend to find willing partners in both parties to make that happen. so let's get to work. thank you very much, everybody. thank you very much. [applause] shannon: the president's first remarks since his election on tuesday. saying the american people, in his view, have signaled they don't want people to think compromise is a dirty word. he is holding that they can find

a way to work together. he says that you can't get your way to prosperity without working together. what are your reactions to the president's remarks? >> well, he said he's open to compromise and new ideas and that he refuses to accept any approach that isn't, in his words, balance. it is what we have heard from the president on the campaign trail. but he believes that the people spoke on tuesday night and that they are approving his approach to raise taxes on those who make $250,000 or more per year. now, he says even as we are negotiating a bigger framework and deal with this fiscal cliff approaching, he says even that we are negotiating now, and as we are doing so, to extend the middle-class tax cuts now, samantha is here to say it is

the same as raising taxes on the upper tier, $250,000 or about. that is where the pushback will happen. republicans in the house do not believe that raising taxes on anyone in the economic time -- especially one that is as fragile as it is now, they believe that giving tax reform on a broad scale is the right move. how that works at the negotiating table? how that happens in the next couple weeks as we have this fiscal cliff approaching? well, we don't know how it will play out. but we do know that the president has put his cards on the table and he is pretty forceful. he is sounding pretty confident that he's going to stick to his guns. shannon: the speaker says this is a chance for the president to take hold of his leadership. this is more of what he is saying. >> i'm not talking about 3000 page bill. what i'm talking about is a commonsense step-by-step

approach that would secure our borders, allow us to enforce the laws and fix a broken immigration system. again, on an issue this big, the president has to lead. i think members on both sides of the aisle. the president is going to have to lead. shannon: he talks about the immigration issue. he talks about fiscal cliff issues and the word leadership, which is repeatedly used over the last few days. you said that the president sounded very confident and forceful, but now, putting that into action, you and i live and work in washington we know there hasn't been a lot of meeting of the mines. do you have hope that will happen in the next six weeks max three there is going to be some meeting in the mind that there has to be some short-term deal. both sides know that they have to get something done before the

end of the year. republicans know that they can't be painted as the party that took them over the cliff. however, it is also, you know, they are going to try to hold to the principles that raising taxes they don't believe is the right thing for the economy at this time. at one point, president obama believes that raising taxes and a fragile economy actually -- an economy that was doing better than the one currently, was not the right move. but the president is saying what he is saying now. saying that he wants the taxes and the tax rates to go up on people making $250,000 or above. and he believes that that is the right move and he will pressure republicans to accept that. could we get something if the cap goes up? yes. $500,000. $1 million. that could be what we see as a negotiation table unturned.

shannon: we know you will be on it every night. megyn will be here on "america live". we also have new questions about campaign rhetoric and the race to the white house. did team obama mislead about governor romney's position on immigration? we have the tape and we will have the debate. eleven days after sandy hits. whole communities are still in shambles. after suffering a punch from the hurricane and this week's nor'easter, are they a little too quick to take credit for the response? we will talk to the people who are still devastated with the recovery efforts. >> these people are staying in their homes. they are not leaving their houses. there is nothing going on. my house is $292,000. i don't know how to replace it

shannon: nearly two weeks after superstorm sandy, hundreds of thousands are in the cold without power and asking when the so-called aftermath will ever and. gas rationing adding the frustrations today. it is now with unturned in effect in new york and new jersey. drivers place their fillip days based on their license plates being odd or even. adding insult to injury, miles of destruction -- many homes destroyed completely.

many are questioning what is going on. >> summer being allowed to return home for the first time but not permanently. folks feeling like refugees in their own neighborhood. david miller is live in sea bright, new jersey. what is elected a? back it is a community still recovering. you can see the national guard on ocean avenue. just about every single building here was in one way or another severely damaged. 1300 people live in this community. the mayor says the cost of the damage is estimated at $391 million.

what did you see? >> my apartment has been decimated. it's a level five, so unfortunately, i cannot get any myself out of this. it's heartbreaking to see the first time you come into town. i came in a few days ago. i have been privileged enough to help her counsel and it's very difficult to look at. my whole life has been washed away by the ocean. >> had they been able to talk to you and tell you about what kind of assistance has been provided and you have been able to recover to some degree? >> i'm not sure about anything in my apartment. i know that they are helping a lot of people in town. as you can see when you look around, we definitely need all the help we can get. luckily, here in sea bright, new jersey, we are a family and we are all working together to get back on track.

>> we wish you the very best. very quickly, shannon, i want to tell you that one of the businesses destroyed is called woody's. what he himself is not running his business today. instead, you can find them here in this sort of set up by the national guard and all of this food will -- you are open for business in a different sense. what have you been doing reign. >> we are reaching out to all our food vendors, we got a massive response from u.s. foods and a couple of other vendors. we have truckloads of food. we call the national guard literally. the sanitation facilities, the whole 9 yards, we are doing everything we can for anyone who comes to sea bright. literally, the entire town has

been decimated and there is not a single place in town to eat or get a drink. anyone who is hungry or thirsty, we will take care of them. >> everyone appreciatappreciat es what you are doing today. it means a great deal to this community. i asked the mayor about when this community will return in normal. it is described as a getting to a new normal. shannon: david, thank you so much for taking us to see these stories. the next best describes the stories on the ground and what he describes as fema failing to respond. christian, thank you so much for joining us. can you give us an update on how they are faring? >> you know, we have not lost my family, per se, but family and

friends. businesses destroyed. i would say that the spirit of staten island has been strong and we have never seen a neighborhood outpouring outreach like this before. but people really need help. especially with the nor'easter hitting us this week, it was really cool. people are afraid to keep their houses for fear of losing what they have a little less. at this point, the government response, the fema response has been very slow. they are just getting started now and they are 12 days from the storm. shannon: how are they doing for food and water and one of? where are they going? >> the main hit areas have just been volunteer effort to go out there and boot entries, churches, handing out warm meals

and goods to people that need it. i had friends last weekend that we are not there. anyone who needed it. a lot of people are proud and are afraid to ask. as far as shelter goes, they are really relying on friends and neighbors at this point. i only know that at this point. shannon: it sounds that so much where neighbors are trying to help out where the government hasn't been able to do it. christian, our prayers remember with you. we thank you so much. things across the country and

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shannon: >> the american people voted for action and not politics as usual. in that spirit, i have invited leaders of both parties to the white house next week so that we

can start to build consensus around the challenges that we can work together. shannon: that as president obama speaking in the east room of the white house saying that he had invited congressional leaders discussed spending cuts and tax increases that will take effect soon if they don't come up with a brand-new compromise. the president says raising taxes on the wealthiest americans must be part of the plan. and that he will refuse to accept any approach that is not balanced. chris stirewalt joins us and lou dobbs will do the math on what this means for our deficit. new questions today about the obama campaign's messaging and whether it intentionally mischaracterized governor romney's mets stance. take a listen. >> talking about them and saying

that he would veto a piece of legislation like the dream act that, you know, only for latino voters, making it hard for them to get votes. shannon: the dream act is a bill that would grant conditional residency to certain residents. just a few weeks ago we talked about key part of that lot remap the kids of those who came here illegally, those kids should have a pathway to become a permanent resident of the united states. military service is one way they would have that kind of pathway to become a permanent resident. shannon: alan colmes is here and my gallery there is a fox news contributor and author of the things liberals love to hate. thank you for coming.

is it fair to say that he respects some of these short-term visas that he has granted under special conditions be met like every other issue that has been all over the place, he refuses to say whether he would keep the dream act as president obama sign it as the elected president, he never answered that question. hebert said he was against the dream act and later he clarified he would keep in place for those that served in the military and never answered the question about whether or not he would renew the dream act signed by president obama. basically saying what the obama people said about this, that it was accurate. >> there is no question about what obama did. the question is what romney really stands for. >> he has been all over the place the. shannon: alan, when he was asked

whether he would veto the dream act, he did say yes, but immediately after that, he said he would provide a pathway for military service. >> he never said whether he would renew the dream act signed by president obama. he was asked that over and over again and would never answer the question. shannon: it sounded like he didn't like all that, but parts of it. >> you sound like you're still in campaign mode. [talking over each other] [talking over each other] >> you one. you don't have to keep arguing about mitt romney. >> excuse me, can i get a word in? you know, you don't have to keep beating up mitt romney. obviously, he mischaracterized what he said about the dream act. they did so throughout the campaign. this is a guy that with your prizes being a felon and a tax cheat and he killed a woman with cancer. frankly, this almost pales in comparison to the lies and distortions by the obama

administration. this speaks to the real need to analyze as a republican party what role hispanics will play and how republicans should or should not reach out to hispanics. it is a debate we have to have. >> this is not with the american people. continuing to beat up on the president who won the election. >> what but you want to beat up on mitt romney? [talking over each other] >> the campaign is over. it's finished. let's move on together to try to make it a better country. >> it is a big waste of time. shannon: but what is said during the campaign makes a difference in who people vote for. if either side was lying or not telling the truth. >> there is a lot of equivalency on both sides. mitt romney did not win the hispanic vote and the republican party, rather than making

excuses or trying to call president obama a liar, -- let me finish this -- you need to address your problem with the latinos and do something about it. and stop beating up on the guy who lost an election. shannon: we will say that romney has changed positions on things. is it fair to say that the president realizes there are other things as well. politicians of all and their ideas. >> i happen to agree that it's time to move forward. the election is over. we will be up on obama for the next four years. we will try to challenge everything that he's doing that we disagree with. there is no question that the republican party will have to do a great deal of soul-searching. i am a fan of heather mcdonald. she writes a really articulate piece about the fact that this is silly to try to chase after hispanics. hispanics, she argues, have a disproportionate, reliance on big government. we are not going to get

hispanics to vote this way. >> they want free stuff like the 47%. >> are you characterizing them as one free stuff? >> will do the numbers. in california, there is a disproportionate amount of hispanics. as california goes, it is a great essay. a lot of argument -- i mean come you guys like that. saying you republicans have to figure out your problem. shannon: think of all the fun you'll have in the next four years. great to see both, thank you very much. >> the country has as one week to meet a critical deadline for rolling out obamacare. doctor marc siegel is next on what it means for you. after decades behind bars, a man is released that his ex may have framed him for double murder. answers about what happens now and trace gallagher investigate.

>> the family was altogether. we had pizza and i allowed myself one beer. after 30 years. it was a little bit hesitant to go beyond that point. but we spent the evening together, and it was great

shannon: seven days until a critical deadline on decisions that will change life as citizens. next friday is the day that governors must report to the federal government and constitution of major health care reform will take place. marc siegel is professor at nyu medical center. great to have you with us. this is all about whether there will be a seed exchange, a federal exchange -- how does it

work and why should we care? >> it is virtual. we saw with medicare part b that no one can figure this out. it will vary from state to state. so far, 16 states plus the district of colombia, nine have said absolutely no, which includes texas and florida that had been again every aspect of obamacare. that leaves over half of states saying that they are not s yet. which means lack of uniformity. we try to figure out that we predict a lot of people may lose employer-based insurance and have to go to individual based insurance if they can't afford a federal subsidy. i'm concerned that the kind of

insurance as that this is the kind that will allow you access to see this doctor whether you are sick or well. i am concerned that it may not pay for high technological solutions on the other end that don't work for everyone. that are brand-new and bells and whistles that are really exciting, personalized medicine, but a very expensive. insurance companies may decide not cover it. and medicare, or that we have talked about, they may decide not to cover it. shannon: these changes are where a consumer in the state of utah -- they would have to shop for your insurance. that is where they will be better than products will be there. so they can set their own, they can allow the feds to come do it, or they can do a kind of a hybrid. but you are talking about it significantly changing what insurance is available or how it works for people in practice? >> absolutely. what i'm most concerned about is the price of premiums. i am all for that.

we do that in new york state already. no lifetime limits. that's great. i want people to be covered up to the age of 26. the kind of insurance where people up to 26 -- it's the same kind of comprehensive insurance that i am concerned about. too easy to overuse. you know, we talk about preventive medicine. a lot of those services are very expensive and i predict that premiums are going to go through the roof. you will go to the state exchange, but you will start to pay very high premiums. if we would've had portability of insurance with for the federal exchange, then there would have been real competition. i'm also concerned that many doctors won't take this insurance. they may drop out, retire early, we are already seeing a lot of practitioners and assistants fill the void. i saw someone very close to me in the emergency room never saw a doctor or if that's okay, you can give basic care that way, but what if something goes

wrong? i don't want to see doctors leaving the system that they may not be able to work with this insurance. >> the whole idea was to bring down the cost of care to make sure that most people had access to care. it looks like there are going to be some kinks in the road trying to get their. >> more access to insurance, but not necessarily access to care. your doctor may move to a hospital or a large group. you could possibly continue to see them if you are in the area of a major medical center. a lot of changes. shannon: a lot of changes, but glad you're keeping us up to date. we have breaking news from the pentagon about the military's response to the terror attack in benghazi, libya. jennifer griffin will have more minutes away on that. and coming up next, a judge is a convicted killer after 37 years in prison. who he is accusing of helping to put him behind bars. >> i believe the statement of

innocence -- i don't know 10,000 times since and i have taken that statement to the grave.

shannon: a tangled tale of murder and justice delayed. the convicted killer is set free after spending 37 years behind bars for a double murder. but the plot is thicker than an agatha christie novel. his estranged wife apparently framed him for the crime. reporter: the murders happened back in 1962. but it was unsolved in 1972. they found a partial palm print belonging to bill mccumber.

he worked as a gas station attendant where he had recently told of the victim's car. later, he confessed to the crime. at the time, the ex-wife worked for the sheriff's office, had access to the evidence, and she, herself, was expected of running a sex rang inside of the office. the conviction was overturned a person in the second trial, the husband was convicted again. during all this, another man confessed to the crime. but he died in jail. his confession was ruled. in 2010, the son said that he thinks his mother for in his father. >> did you bring your husband? >> no, absolutely not. reporter: now, he could have been released years ago if he

had pled guilty, but he wanted a new trial. with the evidence gone and many witnesses dead, that was impossible. the victim's family and the county attorney and governor jim burr still think he is guilty. >> if we have the evidence and shells on the ground, we would've gone forward. we would've given a guilty verdict again. listen to this man after being free after 37 years to this case is nothing more than a set of victims from the beginning to the end. myself and my family, we are all guilty. that is about it. reporter: he had a pizza and a beer for the first time in 30 years.

shannon: thank you, trace gallagher. new reports of people scared to lose their homes because of looting. and the iranian attack on a u.s. drone. what we should have known. to turn around because of business people like you. and regions is here to help. with the experience and service to keep things rolling. from business loans to cash management, we want to be your partner moving forward. so switch to regions. and let's get going. together. your doctor will say get smart about your weight. i tried weight loss plans... but their shakes aren't always made for people with diabetes. that's why there's glucerna hunger smart shakes. they have carb steady, with carbs that digest slowly to help minimize blood sugar spikes. and they have six grams of sugars. with fifteen grams of protein to help manage hunger...

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shannon: this is a fox news alert on the fiscal crisis facing the country and new fallout from the president's remarks last hour. a live look at the briefing room where jay carney will be taking questions from the press. something president obama decided not to do today. he decided to make a statement with an audience the white house described as the middle class and other stakeholders on the president's approach to tax the wealthy. >> i refuse to accept any approach that isn't balanced. i'm not going to ask students and seniors and middle class

families to pay count entire defend city while people like me making over $250,000 rbts asked to pay a dime more in taxes. shannon: you heard the president's remarks earlier, what's the latest, ed? >> reporter: jay carney will be taking questions. something the president did not do. normally presidents have a news conference after their reelections. this was a chance for the president to lay count markers on where he stands and offer an olive branch to try to get this jump started. a lot of pressure on leaders in both parties. we have economists saying we could head into a double dip recession. you have had the markets rattle on wall street. so the president its coming off a strong victory tuesday night

but is facing the real reality of governing as this has to be dealt with. i think you heard that he was saying he wasn't going to compromise his principles. he did not use the word mandate but all but claimed a mandate saying this balanced approach he's been talking about about raising taxes, that was fronts and center in the campaign and he says democrats won on that issue so it's time as he put it to get a majority of congress to agree with the will of the american people. his challenge is going to be that house republicans like john boehner have a mandate as well. they were reelected to be in charge of the house. they are saying they don't want to raise taxes at all. they are willing to look at closing loopholes but they don't want to raise tax rates. we are where we have been for months in these negotiations. shannon: we know you will be

there in the briefing. we'll keep an eye on it as there is news. we learned a couple hours ago about the administration's decision to organize today's events with an audience standing behind the president. the white house described them as middle class americans and stakeholders that support his tax plan. it's drawing comparisons to this. remember 2009 when the white house communications team hand out white coats to doctors who were there and had them stand behind the president in support of the healthcare overhaul. chris tires walt, what do you make of the optics of this event for the white house today? >> reporter: it's very clearly a campaign-style event. the president coming off of really a campaign that was 18 months long. 20 months long is not shifting

gears. he's coming back and keeping it up and doing this kind of event which we saw throughout the 2012 campaign. this is him saying that he is going to do everything in his power to bring public pressure to the republicans to allow the tax increase. and if they don't do it he's going to try and make them pay the price. it's funny he said the time for politics is over. but this was very clearly a political event. shannon: as you said, the way this was staged and rolled out, it does seem to put public pressure on the republicans. he said the american people sent a message loud and clear, they don't want the american people to think compromise is a dirty word. are you buying never it? >> reporter: it's meant to be sold. john boehner came out first and laid count first marker and said i'm eager to compromise.

i don't go for a tax rate increase but i'll go for a tax payments going up by closing loopholes on top earners. this is the president saying i won, i will go out and sell this against an unpopular congress and i'll make you pay and i'll make you give me what i want. the president understanding that he doesn't have to face the voters again has decided he's still going to try to use the power of the presidency and the power of his political organization to get what he wants which in this case is a tax hike. shannon: traditionally after election or reelection presidents elect do hold press conferences. it's being described as a photo-op. when can we expect to see any kind of interaction between the president and the press? >> reporter: it's been a long time. about 8 months since we last had a presidential press conference. there are a lot of people in washington and a lot of

democrats were hoping what the president would do at this moment having won reelection but having republicans continue to hold a big majority in the house, that he would use this moment to be magnanimous. and maybe it first thing he would do would be to huddle with in a way that hasn't high pressure, republicans in congress and show that he understood the need for compromise. this is a very clear message to people who have been suggesting that or anybody who has been expecting that that the president was going to do what he has common in this term, which is try to beat them and try to break the republicans, not try to cut a deal with them. >> web re we had the open televised meeting. when the president sat down with some of the leaders to hammer out ideas. there was a camera in the room. it doesn't seem lining it accomplished a lot. the meeting is supposedly one week from today. will be behind closed doors. do you think that will be better

for an honest exchange of ideas and finding of common ground? >> reporter: it's been suggests the thing the president needed to do was to take them to camp david but get as far away from the cameras and public pressure to try to do the deal because the time is so short and the consequences of failure would be so severe with a tax hike for all taxpayers and the sequestration. that the time has come for a little graciousness on both sides. but -- one day at the white house. they have done that before. maybe there is a new attitude and a new mood. so far it looks like the president is going to continue to do what he has done throughout this term which is hit hard and force republicans to do what he wants. shannon: chris stirewalt, thank you, sir. concerns wait seems the focus is on tax hikes and we are not hearing about spending cuts.

lou dobbs is going to join us to crunch the numbers on what the president wants and wait will truly mean on paper for our economy. this is a fox news alert. we are about 20 minutes away from what could be a critical briefing at the pentagon where defense official we are told will give a background briefing on the d.o.d.'s response to the september 11 terrorist attack in libya that left four americans dead, including our ambassador. this as we are learning defense secretary leon panetta said the military did not have armed aircraft near libya that could have helped. jennifer griferin joins us live from the pentagon. >> reporter: in just a few minutes the pentagon is finally going to brief reporters with its time line of what happened the night of the benghazi attack from the military's perspective. we have been asking for this time line for eight weeks. we'll be briefed off camera by a

senior u.s. defense official. here is what we have been able to piece together on our own. the national command authority began moving assets shortly after 3:47 p.m. eastern when the first calm from the embassy to the state department was made. but none of those military assets were given permission to enter libyan air space. panetta said none of those military assets would have been in a position to help. they would not have been there in time. general carter ham was visiting washington and in the pentagon on 9/11 and went to the ops center and did all that was within his power to authorize. ham ordered a rescue unit to deploy from croatia on a modified c-130 plane. it was carrying more than 30 special operators from the charlie 110 company that had

been flank croatia. a modified c-130 could are been there under 3 hours from takeoff. but we don't know what time that plane took off. croatia to libya is the same distance approximately from washington, d.c. to miami. further the modified c-130 plane carrying the special operators can fly for 9 hours without being refueled. it's not clear what time it took off from croatia. what can't be confirmed is what time would have been outside libyan air space if at all. multiple defense sources said the plane did not have permission to enter libya. that permission would have to be secured by the libyans by the city department. it lands at sigonella at 8:57. shannon: countless communities

devastated by superstorm sandy. a lot of them don't want to leave their homes and it's not because they don't have another place to go. trace will join to us explain. 7 navy seals including one who was a member of the team that killed usama bin laden in hot water. the obama administration facing questions about its release of information regarding an attempt by iran to take out one of our drones. did the white house deliberately sit on this information until after the election to save itself embarrassment? >> either our intelligence agencies take a week to ascertain one of our drones had been shot at or this is an obvious attempt to manipulate it until after the election. wahlalalalallala! smooth, but crisp. it's kind of like drinking a food that's a drink, or a drink that's a food, woooooh!

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politicizing foreign affairs over benghazi. here we have an incident that occurs november 1, we have an election five days later. we hear nothing about it until two days after the election. either our intelligence agencies on which we spend $60 billion a year take a tweak ascertain one of our drones has been shot at or this is an obvious attempt to that nip late information and hide it until after the election. shannon: raising new questions about our breaking story yesterday ... who made the call to keep a lid on iran's attempt to take down one of america's drones. he pointed out the administration wasted no time in leaking details about the action to take out usama bin laden. kt macfarland joins us.

the pentagon said this was a classified mission. that sounds like a legitimate excuse on its face. >> so is the bin laden raid and they didn't waste any time of giving us the most minute details of that. iran attack a u.s. drone in international waters? that's technically an act of war. are we surprised in politicians covering things up they don't want you to know about. pal advertises bragging about things they want you to know about? politicians aren't honorable men acting honorably. there is a reason politicians couple as the least respected people in the united states of america. i'm not at all surprised. shannon: if this information was purposely withheld from the american people just days before the election. what was the information the administration was trying to

hide. >> i think it's a different conversation -- iran was trying to give as you bloody nose just to flex their muscle before an american election. this is an opening statement in what perceives and the obama administration perceives as a deal to be had with iran. there has been a lot of chatter in the national security world about is there a negotiation the united states will have with iran after obama is reelected. is there a deal that will be made where iran will stop just short of make a nuclear weapon? the problem is it leaves israel out of the equation. even though the united states and iran and the obama administration might come to that kind of a deal. forget about the consequences that deal might have, israel isn't going to necessarily like that deal. and if israel perceives it's

been isolated and it's on its own they may do something, preemptive strike against iran. while israel can start that war. it can't finish it. and that's why iran did what it did. it wanted to show the united states that whatever happens between israel and iran, don't realize -- don't forget the fact that the united states will be drawn into it, too. i think it was a warning shot from iran. shannon: the white house denied there are secret talks involving valley jarrod. they say it's absolutely not happening. this isn't the first time we heard a report along these lines. what is your sense? >> my sense is we probably are -- maybe not directly negotiating with iran. but there have been suggestions the united states and iran are looking into some kind of diplomacy. one of the first things president obama did when he was

elected the first time, one of his first statements is we reach out the hand of friendship to iran if they would only unclench their 50s. the obama admin shall sh shall be -- if they would only unclench their fist. no wants a war with iran. iran doesn't want a war with us, we don't want a war with iran. the question is, is there a way of stopping iran's nuclear program short of a war. that's the big question not just for the united states, but for israel. shannon: you mentioned israel may be willing to engage in that preemptive strike. do you think obama's reelection makes them closer to that or further away? >> the most important relationship president obama has in his second term is going to be with israel. the united states and israel may not have to see iran as the same threat. israel looks at an iran that's about to get nuclear weapons and an iran that says with those

nuclear weapons they would destroy israel with the sons and daughters of holocaust survivors. if there is daylight between the united states and israel, iran is successful in driving a wedge between the two. then i think it makes the conflict in the middle east more likely. what president obama should be doing is going to israel and saying we'll be with you on this. we'll work together to make sure iran doesn't threaten israel or the united states. but most particularly israel. shannon: new reaction to president obama's remarks on the looming fiscal cliff. he talks about raising tax but not so much about cutting spending it was one of the hardest hit areas by superstorm sandy. now we are getting breaking news from the white house on recovery

efforts as the situation at staten island goes from bad to much worse. pot now legal in a couple states but forbidden under federal law. we'll show you how one state is trying to sort those conflicting laws out.

shannon: 7 navy seals punished for revealing classified information to a video game maker. one of the seals was a member of the team that killed usama bin laden. they are receiving order of reprimand and they are having to give their pay for two months.

the game portrays realistic military missions. jay carney announced the president will be traveling to the new york city area to view clean up efforts after hurricane sandy. we are told people are still huddled in their home in the hardest hit parts of staten island with no power and no heat, not because they have nowhere else to go. but because they are worried about losing what little they have left. >> reporter: we are hearing reports of criminals going door to door claiming to be rescue workers and when nobody is home they go in and help themselves. over the past three or four days the number of looting reports has gone down. but if you look around you can clearly see that people are taking no chances and they are staying put inside their homes

with no power. listen. >> the first couple days we were okay. then the looting started. then the anger started to boil and a lot of tension and stress and reality what's happening started to hit home. that we are on our own. >> reporter: because they are staying at home with no power and using gas generators we are seeing more and more cases of carbon monoxide poisoning. 10 people in the northeast have already died including a 44-year-old long island woman yesterday. dozens more have been sickened because people are trying to stay warm inside. 10% of the deaths post katrina were because correspond ban monoxide poisoning. keep the generators 20 feet from the house. house. fema is sending in mobile homes to the areas that were hardest

hit. so far only 40 of those mobile homes have been sent in and the states have not requested them. but in coming days they believe many, many more of those mobile homes will be needed. damage estimates by the way, it was thought to be $50 billion. now they believe that $50 billion will be the number just for new york. and it's going to go up for new jersey and the surrounding areas. this could be the success costliest natural disaster ever behind hurricane sandy. shannon: thank you very much for keeping us updated. we'll speak to a staten island up councilman who says the destruction is a disaster beyond anything he has ever seen before. he will join us to talk about the growing frustration of the people who live there and continue to wait for help 11 days after sandy first dropped. president obama set the tone for

what could be a long battle for the so-called fiscal cliff. why was the focus on tax hikes and not a lot about spending cuts? lou dobbs is next. an armored truck filled with money crashed. how did thousands of dollars disappear after police arrived on the scene. military families sacrifice so much. coming up, get out the tissues, a heartwarming reunion. i might not make it through and you don't want to miss. >> it's been a really long year. i'm really glad to have him back.

>> as i said before, we can't just cut our way to prosperity. if we are serious about reducing the deficit we have to combine spending cuts with revenue. and that means asking the wealthiest americans to pay a little more in taxes. >> that was president obama speaking a little more than an hour ago, flanked by people the president described as supporting the tax on the wealthy. lou dobbs joins us to hash it out. great to see you. >> reporter: quite a day we are having.

i was expecting the president -- the white house made much of the late arrangements of the speech from the east room and the president to speak:economic growth and the deficit. i said to neil cavuto the night of the election and others. this president is too smart. he will step up and be the great leader that he had the potential to be when he was elected in 2008. an opportunity lost for a president who became ideological. i think this time he's so smart he will seize the opportunity to truly be a leader of the people. and -- shannon: do you think he failed to do that today? >> i watched the market unwind as spoke. this is an angry man today. what's he got to be angry about. why is he hectoring people.

he's absolutely dr. downer. we are going to have to do this and it's going to be this way. this is not a man inspired to communicate and lift the people with whom he must work. speaker boehner, minority leader mcconnell, just for openers. shannon: next week they will have a meeting at the white house. there are so many issues cop the beginning of the year. there are 7 different categories of taxes that will expire. there are taxes associated with the president's healthcare law and a surtax on people. essentially in the words of someone i should cite. essentially they accuse the american people of voting for unknowingly or being uninformed for a $500 billion tax increase. they just vote for it. >> both republicans and democrats signed up for it it was a way of absolving

themselves of the necessity of using judgment, discreet judgment and take responsibility so it created and i automatic mechanism called sequestration it's mind boggling the irresponsibility. it's no wonder politicians are rated oh low about it american public because both parties were performing horribly here. i was heartened to hear senator mcconnell say he didn't come to washington, d.c. to raise taxes. speaker boehner said he was waiting for the president's leadership. and of course the president a couple hours later was to say the senate passed a bill, it's up to speaker baner in the house to do what we told to you do. shannon: but elections do have consequences, the democrats are in control of the senate. >> but that doesn't make it a 2-1 vote. this is a president.

he may enjoy trying to go around congress. but there will be consequences for actions as well and attitudes. this president is going to have to deal with speaker boehner and the minority leader. there will be a significant cost. the republican party right now is where it was in 2008 after president obama won that election. it's where the democratic party was in 2004 after george w. bush defeated john kerry, killed with recrimination and remorse. what could we have done. all of that is healthy ultimately. but that should not be interpreted by this president as a foundation of his strength or source of republican weakness. it is a process of rebuilding strength. as we look at what he said today, he said he wants to talk about balance. but didn't talk about spending cuts. all of these -- more than 20 new taxes will not amount to the

same amount of money. it will be about 60% of the total deficit. that's wait amounts to. so it's going to have to be what the president alluded to vaguely as balance, and whatever they agree to. there will have to be sharp, tough decisions on what will be cut in this federal budget. it's unsustainable. one thing that cheers me and should cheer everyone concerned about responsible fiscal policy is that this president doesn't have any choice. by the way, ultimately neither does baron or mcconnell. we are watching all of the prolific spending, the irresponsibility come crashing down around our heads. the markets cannot suffer much more of the irresponsibility. the i am pennsylvania maturity and the nonsense. we cannot continue to pay all of these bills. we are talking about a reckoning that is at hand.

we call it the fiscal cliff taint's here. shannon: we can only hope the men and women of washington will come to the table and act like adults and think of country more than anything else. >> even if they don't do that the markets and the fiscal reality will bring them by the name -- bythe napes of their ne. what we have to hope is it happens before the markets crash in disappointment. shannon: when my parents found out i overextend my credit card in college. that didn't go away. lou dobbs, great to see you. >> reporter: i'll about it wasn't more than $5 or $10. >> we have taken a step forward. we are going to send a message around the world that marijuana

prohibition has failed. shannon: voters approved state amendment 64 tuesday. you whether they will be able to legally buy pot in colorado is still up in the air because it's illegal under federal law. alicia acuna is live in colorado. >> reporter: the governor is required to certify this law about it beginning of next month. today he has a phone call scheduled with u.s. attorney general eric holder to figure out what happens now. while it soon will be legal to possess up to ounce of marijuana and tbroip to plants, it's against federal law. we talked to the colorado attorney general and he said it's his job to enforce the laws of the state. he's waiting on the feds as well. >> we owe it to the people of colorado to state your intentions. are you going to criminally

prosecute these grow operations? because people contemplating going into the business need to know that. >> we are told it could be a year before you see any retail stores open. there is a lot of figuring out that needs to happen. not to mention the possibility of lawsuits. colorado allows for medicinal use of marijuana. those stores will not be allowed to expand for the general consumer because they have a separate tax rate. we talked about the legal options going forward. >> you could see the federal government come down strongly against what happened here or the tolerance of the state experimenting with legalization we have seen the last three or four years or we could see some negotiated settlements. >> reporter: we'll let you know what happens with that phone call with the governor and the attorney general.

shannon: as we get news the president is headed to visit the storm-damaged areas of new york there are serious questions about fema. that's right after this break. >> this is everything i own. out in the front of the garage. [ male announcer ] when it comes to the financial obstacles

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>> we all have wells that are on an electric system. we have to get water to go to the bath room somewhere else and flush our toilets. i have an electric stove. i can't even cook. >> it's not fun because you can't do anything. all you get to do is play board

games. >> reporter: has it been cold? >> yes. >> we are testing the system to see if we can consider opening the school tomorrow. >> they need to get back to school definitely. it's been rough. shannon: growing frustrations for victims of superstorm sandy. 11 days later thousands still don't have power. look at it. it's like a war zone. on staten island people saying the help they have gone the has mostly been from neighbors. they say they have not seen anyone from the state or federal government to help them out. wednesday fema's staten island office closed down due to the storm. staten island councilman is on the phone with us now. even our connection is difficult because phone lines and connections are difficult out there as well.

can you tell was you have seen and what you need. >> thank you for having me and highlighting staten island. our resolve is being tested. but the community has been unreal. it's been from the area we have had moms and grand moms cooking food for the volunteers in the field. everybody is pitching in to make eight community effort it's going as well as it can goin the circumstances we have to deal with. but i don't know where we would be without the robust community effort. we are trying to put people together, contractors donating their time to those who need their basements pulled out it's an enormous community efforts. shannon: we see people pitching in and it's heart warming to heart stories. for a lot of people the help they need from major government invention, they seem very

discouraged that they can't get through on phone lines. no one has shine on their streets. it is cold. they don't have power or water. what's the frustration level like? >> people are somewhat moving from the deconstruction phase to the desire for a reconstruction phase. they want to put their lives back together. the help is not forthcoming. the biggest disappointment for me has been through con-ed. i have 10,000 people in the beachfront communities that were hit the hardest and they had 100 inspectors going door to door. when is that going to be done? i lost it yesterday. i said i can't believe this is acceptable on behalf of anybody in the company. i called mayor bloomberg and governor como's office and both of them respond and they agreed. and we have more people -- 225 on the ground today with more

coming tomorrow. why did it take me to freak out to get this community what it needs. we are in the dark 11 days. shannon: just one example of the hardships. they want to move on to reconstruction. one guy said he was offered $19,000 for a house that the market value would be close to $300,000. how are people going to recover when that the deal they are being given? >> fema's limits are what they are. they are somewhere in the $30,000 mark. it's very little if you are a homeowner you can do with $30,000 when your entire basement and electrical panel is destroyed. we toirnt community and local contractors who are willing to work for very cheap or even free to help our neighbors. and i have'to tell you we are doing it. there are some silver linings in

the story with the community pulling together. people on higher levels of government don't want to come in to help. fema has been in the field and willing to help. i don't know if people appreciate the role fema plays. they don't make everything go away. they play a supportive role through local officials. shannon: we have to be self-relights and resilient. it's fantastic to hear about volunteers coming from all over the country and people cooking meals. maybe that's how we should be operating in our lives on a daily basis. >> it's always the people that do it for themselves. shannon: we wish you the best. we know there is a long

difficult recovery. we thank you for advocating on their behalf. an american soldier found out one of the biggest challenges he faced was his plan to surprise his loved ones with a long awaited trip home. >> whatever peck takes i have, of coming home and surprising erika is far outweighed for the moment when i see your wife and child again. >> it's been a really long year. i'm really glad to have him back. in america tay we're running out of a vital resource we need

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shannon: he had two tours in afghanistan fighting for our country and our freedom. when he came back he says he

faced one of the biggest challenges ever, keeping his compose our before surprising his loving family. >> reporter: one by one 700 students and staff filled the auditorium. they have no idea who's waiting count hall in a quiet office. >> you never stop missing those who make your life complete. >> reporter: he's trying to keep it together but he's clearly nervous. his almost 7-year-old daughter is one of the students. she has no idea he's walking count aisle. >> i'm nervous like a first date. >> reporter: the surprise was the captain's idea. >> the special guest is going to give an award to a special special person. >> reporter: the assistant superintendent gifts nod and the blue curtain opens. all is quiet for a few seconds,

then the gasps an applause. his wife who is a math and science teacher at the school also surprised. she grabbed her daughter anna who runs right into daddy's arms. >> whatever expectations i had of coming home and being -- surprising rebecca is far outweighed about it first moment when you see your wife and child again. >> it's been a really long year. i'm really glad to have him back. >> reporter: so is a beaming anna who stands on stage as her schoolmates cheer. [cheers and applause] >> reporter: that was heather hayes reporting.

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